The leadership has not taken a strong enough role in ensuring compliance, the report says.

An independent panel has delivered a scathing assessment of the Murray-Darling Basin Authority’s leadership in managing the plan for Australia’s inland river system, warning the plan is being placed in “real jeopardy”.

It has concluded the Murray-Darling Basin Authority (MDBA) has been “unable to assert its authority during the development of water resource plans” and had not taken a strong enough role in ensuring compliance, which is largely the responsibility of the states.

The Murray-Darling Basin Authority’s management plan for Australia’s inland river system has been strongly criticised. Photograph: Dean Lewins/AAP

The ABC Four Corners report in July revealed that despite recommendations from compliance teams on the ground for prosecutions in New South Wales for water theft and meter tampering, there had been little action from the NSW Office of Water.

The NSW Ombudsman last week delivered a report revealing its concerns that the lack of prosecutions had been ignored by successive NSW water ministers.

Releasing this latest report – on the federal side of water management – the prime minister, Malcolm Turnbull, said: “Water theft is a crime – pure and simple. All Australians need confidence the rules governing water use are applied fairly, without fear or favour.”

The independent report, which is contained within another by the authority, highlights dramatically different enforcement cultures among the states, with NSW and Queensland far more lax than South Australia and Victoria.

In its document, the authority concedes it has not given enough attention to compliance. In an extraordinary admission, it says it “has not dealt adequately with allegations of compliance breaches”.

The authority has now come up with 11 recommendations for action and greater co-ordination among governments.

“This review was imperative. Without it we were likely to be faced at 30 June 2019 [the deadline for states to meet their water recovery] with the prospect of the Basin Plan being placed in real jeopardy caused in part by a lack of action on the part of the MDBA but to a not insignificant extent by the failure of states to deliver on their commitments.”

The independent report said there had been insufficient progress on two important compliance areas: accreditation of water resource plans and protection of environmental water.

The report has recommended, and the authority seems to have accepted, that it should be the “last resort” for breaches.

“The review clearly shows that all basin governments need to lift their game and better enforce their water laws, Turnbull said.